Bitcoin Touches $25,000 for First Time Since August as 2023 Crypto Rally Continues


Bitcoin rose as much as 9% on Thursday to trade above $25,000 for the first time in six months as the 2023 crypto rally continues.

Late Thursday morning, Bitcoin (BTC-USD) traded as high as $25,104, bringing year-to-date gains for the world’s biggest cryptocurrency to the north of 50%.

The latest rally in bitcoin comes after this week’s inflation data showed price pressures in the U.S. economy are both “hot and cold.”

Between Feb. 13-15, $112 million in bitcoin short positions were liquidated, or $84 million net of long positions, according to crypto derivatives aggregator CoinGlass.

“There was a combination of spot market buying and short-liquidations who may have been late to the party and thought going short after C.P.I. was a good long-term macro trade,” said Christopher Newhouse, a crypto options trader for GSR.

Over the two-day period that followed inflation data published last month — which also sparked a bitcoin rally — $219 million worth of short positions on bitcoin were liquidated, or $95 million as net of long positions.

“Just goes to show how short-term price action driven by momentum and liquidations can overcome any longer-term views people put on,” Newhouse added.

“We’ve had an amazingly strong rally … I’m surprised at the velocity of it,” Michael Novogratz, founder, and CEO of Galaxy Digital said at a conference on Wednesday.

“When I look at the price action, when I look at the excitement of customers calling that FOMO [is] building up, it wouldn’t surprise me if we’re at 30,000 by the end of the quarter,” Novogratz added.

As bitcoin leads crypto’s rally, all eyes are on its 200-week moving average, which is set at the $25,000 price marker according to Yahoo Finance data.

Total crypto volume across the market has risen 22% to $1.8 trillion in the last week, according to crypto data aggregator Nomics. Trading in North America, however, has fallen more than 15% to $64 billion over this period.

Elsewhere on Wednesday, legendary investor Charlie Munger, a longtime critic of cryptocurrencies, said of crypto trading and investing: “It’s worthless, it’s crazy, it’s not good, it’ll do nothing but harm, it’s antisocial to allow it.”

In recent weeks, U.S. financial authorities have ramped up actions in the sector. In January, banking regulators issued a joint statement warning of the risks assumed by banks that touch crypto activities.

The SEC has also picked up enforcement, fining exchange Kraken $30 million last week for its crypto staking program, the fourth action against a U.S. crypto firm in the past six weeks.

In a Senate Banking Committee hearing Tuesday, Committee Chair Sen. Sherrod Brown (D-OH) lambasted industry firms and asked for the Committee to find common ground in order to pass cohesive legislation for crypto.

“The regulators understand that bitcoin is different, it’s not a security. It doesn’t have a centralized protocol with a small group of programmers in charge of it,” said bitcoin investor James Lavish.

“With that said, it’s going to be volatile and there’s going to be another sell-off, especially if we head into a recession so while it’s great to see the price stabilize and move higher, I would just caution people from getting too excited.”

Featured Image: Pexels @ Worldspectrum

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